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NISM Certifications · NISM-Series-VIII: Equity Derivatives · Sales Practices and Investors Protection Services

A client buys 2 lots of Nifty futures (lot size 75) at 24,000. At the day's end the settlement price is 23,880. The next day's settlement price is 23,940. The client holds the position. What is the cumulative MTM position after the second day?

The cumulative position is a loss of Rs 9,000. The client holds 150 units long from 24,000, and the settlement price is 23,940 after day two, so the loss is 60 points times 150. Day one's loss of Rs 18,000 is partly reversed by Rs 9,000 on day two.

  1. ALoss of Rs 9,000Correct
  2. BLoss of Rs 18,000
  3. CLoss of Rs 4,500
  4. DGain of Rs 9,000

Explanation

Quantity = 2 x 75 = 150. Day 1: (23,880 - 24,000) x 150 = -18,000. Day 2: (23,940 - 23,880) x 150 = +9,000. Cumulative = -9,000. Check: (23,940 - 24,000) x 150 = -9,000. Rs 18,000 ignores day 2 recovery.

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